Third party drops Forge takeover bid

Clough's major shareholding in the Peter Hutchinson-led Forge Group appears to have deterred a potential takeover bid by an unidentified party, which today dropped its proposed offer.

The decision comes a week after Forge revealed that it had received a confidential, non-binding, conditional competing proposal from a S&P/ASX 100 company in relation to 100 per cent of the shares in Forge.

The proposal was conditional on a placement to Clough not proceeding, which shareholders approved earlier this week.

Clough now holds a 19.99 per cent Forge stake.

"The Forge Board has held further discussion with the proposed bidder to explore the possibility of agreeing to a superior proposal," Forge said today.

"Subsequent to these discussions, the proposed bidder has elected not to proceed further."

Shares in Forge shed four cents to $2.84 at 13:15 AEST.

Earlier this year, Forge and Clough announced an alliance deal whereby Clough would invest up to $98 million, or $1.90 for each share, to potentially acquire a 31 per cent stake in Forge.

The deal allows both companies to leverage complementary services in the oil and gas, mining and civil infrastructure sectors.

Since the agreement, Forge shares have climbed as high as $3 per share.